The Best and Worst Markets for Conservative Real Estate Investors

If you're hoping to pick up a housing bargain, a new report that ranks the best and worst markets for conservative residential real estate investors might interest you. Durham, N.C., Indianapolis and Huntsville, Ala., are some of the best locales currently, according to the first Investor Suitability Report by Local Market Monitor, a Cary, N.C., firm that analyzes real-estate trends for lenders, builders and investors. Las Vegas and Orlando, Fla., are some of the riskiest.

The study, which The Wall Street Journal reports on, uses economic data through July 31 for 315 U.S. markets and focuses on single-family homes. Regions that rank highly for investment suitability are those where home prices are unlikely to fall further, Local Market Monitor President Ingo Winzer tells the Journal. They're places where income is growing moderately and where employment is relatively stable.

Places in the "worst" list (several locales in Florida, Nevada and Arizona make the cut here) are ranked thus because home prices there are still falling and the local economy remains shaky.

The report focuses on price-appreciation potential instead of rental income, Winzer explains, since falling home prices usually result in higher vacancy rates and lower rents overall.

Below are the best and worst U.S. markets for single-family real estate investment properties.